Crypto trading has taken the back seat in the digital economy in 2022, with the market remaining under the bears' control for most of the year. Furthermore, traders have seen their faith rocked by the consecutive failures of centralized exchanges. These intermediary marketplaces have been the powerhouse of the industry since its humble beginnings. Now, they seem to crumble under mounting allegations of scams, lawsuits, and solvency concerns. Meanwhile, they make a convincing case for the imminent decentralization of crypto…
In a Twitter post last night, the team behind the crypto-based social media platform, the Chingari App announced that they had not fallen victim to any hacks. Rumors of a rug pull or possible hack began after the Gari token lost more than 80% within 24 hours.
Hacking Speculations Fuel Decline
Last night, the short video platform moved quickly to assuage claims that its network had been hacked, attributing GARI’s sharp descent to a “market event”. Initially, the network’s native token swiftly dropped in price after hacking speculations began making the rounds in crypto circles.
Helped along by the spreading rumors, at some point, the GARI token lost over 80% of its value. However, as the tweet noted, the only market fluctuations influenced the token. The team attempted some damage control with the announcement, reassuring the community that their tokens remained safe in their reserves.
We at GARI network announce that after a thorough evaluation there has been NO hack identified on the tokens' side & so far this looks like a market event.
We assure our community that ALL tokens are safe in the respective reserves. (1/2) pic.twitter.com/4Pb0Fe3VKo
— GARI Network (DAO) 🔥 (@GariToken) July 4, 2022
They also stated that they were in contact with the exchanges and still reviewing the entire situation. Furthermore, they requested that community members keep calm and promised to share further updates.
Chingari App and Its Sinking Token
Chingari is a popular Indian short-video sharing platform with plenty of similarities to TikTok. The platform started in 2018, before amassing more than 35 million users. Chingari delved into the crypto world late 2021, offering a watch-to-earn feature for users and a create-to-earn option for creators. Its native token GARI is a key part of this.
GARI has shown relatively unstable behavior since showing up on CoinMarketCap at the start of this year. At first, the token sold close to $0.7 and later rose to $0.9 by February. Unfortunately, by April it had plunged to under $0.3.
At the moment the token is facing significant pressure. Coingecko reports a trading value of $0.1801, a notable drop from yesterday’s price of $0.7261.
Network Authenticity Falls Under Question
Despite the team’s best efforts to resolve the situation, the rumors did damage the network in some ways. Some questioned the platform’s credibility, while others were of the opinion that Gari whales were pulling out.
Indian crypto YouTuber (aka Moneyguru), Ashish Gautam speculated that exchanges were withdrawing support for Gari tokens, as #GARI trended in Indian crypto spaces.
Other commenters decried the sudden loss in their portfolio despite the team’s assurance that funds were safe. Amid unabated fears of a cash grab and a rug pull, the Gari team continues to assure users that it is looking into the issue.